Economic Methodology

Question 1

What is the Economic Problem 1

Answer 1

How we can manage finite resources against infinte wants

Question 2

What is the Economic Problem 2

Answer 2

how to allocate scarce resources (inputs/factors of production) among competing uses to maximise living standards

Question 3

What is a positive statement

Answer 3

Statement that can be prove true/false using facts , its objective and testable

Question 4

What happens if a positive statement doesn’t pass the test

Answer 4

It is falsified

Question 5

What is a normative statement

Answer 5

Subjective opinions that can’t be proven

Question 6

What is a good

Answer 6

tangible items which are consumed

Question 7

Examples of goods

Answer 7

shoe / tie , CD

Question 8

What is a service

Answer 8

intangible items we conmsume

Question 9

Give examples of a service

Answer 9

decorating/teaching

Question 10

What is provided in an economy

Answer 10

goods and services

Question 11

What is economic activity about

Answer 11

satisfying needs through production of goods and services